Investor's Business Daily is known for teaching people how to invest in stocks. So why cover options trading?
XIBD founder William O'Neil mentioned options in his book, "How To Make Money In Stocks." He wrote that "the secret to making money in options doesn't have much to do with options. You have to analyze and be right on the selection and timing of the underlying stock." That's where we come in.
Many people find stock options more accessible because you can invest without risking a lot of money. Think a stock could have a 10% rise (or fall) in the next couple of months? With options, you can multiply that move while putting less money at risk.
Leverage is key to maximizing your returns. But understand that leverage cuts both ways. You can quickly and easily lose money if you get carried away. That's why O'Neil cautioned investors not to let options make up more than 10% to 15% of your portfolio.
Understanding Options Trading Terms
For many investors, learning a whole host of new terms and different ways to build a trade is a challenge. Options terms like puts, calls, covered calls, strike price, premium, intrinsic value and how to exercise options contracts can be new and intimidating.
Education is the key.
In addition to an Options Trading Course, here you'll find actionable trades as they arise, as well as analysis of the stock and potential trades. As always, risk management and stop loss areas play a crucial role in your education and expected return.
Whether you're making your first option trade, getting additional ideas as an experienced options trader, or just trying to learn more about the topic, we've got you covered (pun intended).
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Options Center: Expiration Dates, Volatility, Covered Calls, Options Trading Strategy & more
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